On June 6, 2012, the Company reported a substantial increase in the mean estimate of gross unrisked prospective resources ("Mean Prospective Resources") in the Eocene reservoir at Kurdamir, following an independent audit of the estimates by Sproule International Limited ("Sproule"). During the drilling of the Kurdamir-2 well, an interpreted oil bearing, fractured Eocene reservoir section with gross thickness of 275 metres was encountered similar to the Eocene reservoir section encountered in Kurdamir-1. A petrophysical interpretation of the Kurdamir-2 wireline logs through the Eocene reservoir has been completed and this, together with mud gas data, hydrocarbon shows from cuttings, correlation to the Kurdamir-1 well and revised seismic mapping, have resulted in the revised prospective resource assessment. Similar to the Oligocene reservoir, the lowest known oil in Kurdamir-2 indicates that the oil column extends significantly deeper than the limit of four-way closure of the Kurdamir structure, as mapped on seismic. This indicates that the Eocene reservoir is involved in a much larger trap which also likely extends off the Kurdamir Block onto the adjacent blocks. Based upon both this new information and the fact that no formation water was encountered while drilling, the revised assessment for Mean Prospective Resources increased from 124 million barrels ("MMbbl") of oil to 278 MMbbl of oil for the Eocene reservoir on the Kurdamir Block as of May 31, 2012.
On April 23, 2012, WesternZagros reported an increase of over 400 percent in the mean estimate of gross unrisked contingent resources ("Mean Contingent Resources") and 300 percent in the estimate of Mean Prospective Resources in the Oligocene reservoir in the Kurdamir exploration block. The updated estimate of Mean Contingent Resources as of April 20, 2012, is 147 MMbbls of oil (corresponding to 464 MMbbl of mean estimated gross discovered oil initially in place) or 384 million barrels of oil equivalent ("BOE") when oil, gas and condensate contingent resources are included. The updated estimate of Mean Prospective Resources for the Oligocene reservoir on Kurdamir as at April 20, 2012, is 1.2 billion barrels of oil ("Bbbl"), or 1.4 billion BOE when gas and condensate prospective resources are included. These updated estimates have been independently audited by Sproule.
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